Banana Republic 2014 Annual Report Download - page 58

Download and view the complete annual report

Please find page 58 of the 2014 Banana Republic annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 96

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96

46
Comprehensive Income
Comprehensive income is comprised of net income and other gains and losses affecting equity that are excluded
from net income. The components of OCI consist of foreign currency translation gains and losses, net of tax,
changes in the fair value of derivative financial instruments, net of tax, and reclassification adjustments for
realized gains and losses on derivative financial instruments, net of tax.
Income Taxes
Deferred income taxes are recorded for temporary differences between the tax basis of assets and liabilities and
their reported amounts in the Consolidated Financial Statements. A valuation allowance is established against
deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be
realized.
Our income tax expense includes changes in our estimated liability for exposures associated with our various tax
filing positions. At any point in time, many tax years are subject to or in the process of being audited by various
taxing authorities. To the extent our estimates of settlements change or the final tax outcome of these matters is
different from the amounts recorded, such differences will impact the income tax provision in the period in which
such determinations are made.
The Company recognizes interest related to unrecognized tax benefits in interest expense and penalties related
to unrecognized tax benefits in operating expenses in the Consolidated Statements of Income.
Recent Accounting Pronouncements
In April 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU")
No. 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, which
raises the threshold for a disposal to qualify as a discontinued operation and requires new disclosures of both
discontinued operations and certain other disposals that do not meet the definition of a discontinued operation.
This ASU is effective for fiscal years beginning on or after December 15, 2014, and interim periods within those
years. We do not expect the adoption of this ASU to have a material impact on our Consolidated Financial
Statements.
In May 2014, the FASB issued an ASU No. 2014-09, Revenue from Contracts with Customers, to clarify the
principles of recognizing revenue and create common revenue recognition guidance between U.S. GAAP and
International Financial Reporting Standards. This ASU is effective retrospectively for fiscal years and interim
periods within those years beginning after December 15, 2016. We are currently assessing the potential impact of
this ASU on our Consolidated Financial Statements.
Note 2. Additional Financial Statement Information
Cash and Cash Equivalents
Cash and cash equivalents consist of the following:
($ in millions) January 31,
2015 February 1,
2014
Cash (1) $ 1,086 $ 991
Bank certificates of deposit and time deposits 341 323
Money market funds 88 196
Cash equivalents 429 519
Cash and cash equivalents $ 1,515 $ 1,510
__________
(1) Cash includes $77 million and $64 million of amounts in transit from banks for customer credit card and debit card transactions as of
January 31, 2015 and February 1, 2014, respectively.